Vilk’s Money Posts

However, there MIGHT be a clause in your credit card or checking account agreement authorizing them to take the money if it’s in their bank. I heard of this once on some radio show so I don’t have any firsthand knowledge, but just be careful and maybe read all of the fine print in those agreements. Unless you have agreed to the contrary, they must sue you to prove that you owe them money…thank God this is the United States of America…where they have to prove you’re guilty before they can take your money.

One thing to consider regarding your other post; credit card companies almost never sue for the balance owed. They threaten like hungry wolves but bite like teething chihuahuas. They know it’s a cost of doing business and we all know they aren’t starving. Listen to all the stories from people who’ve had credit card companies charge off thousands of dollars in debts. Now, I would caution that if the debt is over $5k they *might* actually go through the trouble of suing you, but it will be *at least* a year before they actually start anything. For the first year all of those “collection agencies” and “lawyers offices” are actually companies inside of the credit card company themselves. They won’t sell your debt or hire someone to collect it until well after the first year of non-payment.

They are very good at the game…you need to be strong and smart in order to win.

BTW, thanks for the compliments, but the real reward is “hearing” the difference in your emails when you don’t “sound” so defeated. Make sure you and hubby forget about the debt for one evening a month and have a Date-Night. The only way to come through all of this with your sanity and marriage intact is to be united with your spouse against the debt. That means investing in your relationship even more in the tough times.

I renewed my contract today. I had the contract for 2 years and I get a great discount thru my work and I have to have a phone for a variety of reasons.

Anyway – I stopped by the retail store to talk to them to see what kind of deal I could get. I was thinking that I would get a free phone or something. The store couldn’t help me so I called another store while at work today. They weren’t offering me anything either so I asked the rep what kind of retention strategy do they have? He mentioned to call the customer service line and ask for the retention department.

I called and guess what? I got a $150 credit on my bill just for asking. The rep on the phone said that only the phone customer service department has the special codes to do that. Pretty cool, huh?

So I thought that I would share that it never hurts to ask for a discount. You never know what you might get!

I’ve seen a lot of posts about dealing with the bills, but how about some discussions on how to save money? By cutting costs, we can free up some money to pay off those bills faster.

I think some of if it is just a matter of figuring out where our money is going and realizing just how much we are spending on some unimportant items.

For example, I used to drink a lot of pop. I was buying 3 bottles of pop at work each day. That was 15 bottles a week at $1.08 after tax, working out to $16.20 a week and $842.40 a year. That is outrageous! And that didn’t even include the pop I was drinking at home, another $550-$600 a year. Just think how much better financially I would be if I had been putting that money to bills or just paying with cash years ago, instead of buying pop.

I actually quit drinking the pop to reduce my caffeine, and I do have fewer headaches. But I saved a bunch of money at the same time. I replaced that 3 bottles of pop with one larger bottle of water $1.19. I have tried a couple times to switch to even cheaper water, but I have only found one type of water that I will drink consistently. So, in this case, I saved money and improved my health by making a lifestyle change. It did take a while to actually like the change, but I have grown to like it very much. I drink water at work, and water and milk at home.

There are lots of “vices” that we have, that we spend a little every day, yet we don’t realize how much it is adding up. I never dreamed I was spending over a $1000 a year on carbonated sugar water.

How about coffee (espresso), cigarettes, pop, fast food lunches, etc?

How about keeping a diary and seeing where the money really goes,and then extrapolate to see how much it costs per week, per month, and per year? It may not sound like much per day, but when you think about it in terms of month or year, it takes on a new meaning in terms of our finances.

What other expenses can be cut easily?

Phone, cable, internet, etc. Many of these bills can be combined to one company to save money. Sometimes, we have more than we really need. Check the rates, review what you really need. Is that cell phone really necessary? If so, can you get by with a cheaper service.

Storage facilities? We all need space. I finally opted to get a storage unit since I need space to effectively run my business out of my home. I had put it off because I thought it was very expensive. My sister had a locker that was $75 a month, which seemed absurd to me. I did some checking and found out that I could get a 5′ x 5′ locker for $22.80 a month. Not bad at all, and I was able to free up space and actually have room to work on my business projects and reorganize. But I had to look around to get the best deal. The place I picked is about a mile further away than the place my sister uses. She is paying $75 a month for a 5×10, only twice the space, 3 times the cost, and she has to go up an elevator. Mine is on ground level, just down a short hallway from the door. Also, by choosing automatic payments, I avoid late fees, since the storage places cagre horrible late fees, twice a month. It is really easy to get behind. So, simply by doing a little bit of searching, and checking into options, I was able to find a better rate. The place she was at was going to charge me $10 more per month ($120 more per year), and I would have had to deal with the elevator.

I’m sure there are lots more ideas, and I would love to hear them as I have a lot of room for improvement. This has been a tough year as my paychecks have gotten smaller (lower sunday wage, high health premiums), and my costs have gone up (food prices, gas prices, health costs, etc.). I have manged to make some changes, but I am always open to more.

I have also found it makes a difference where and how you shop for groceries. I work in grocery store, but I often shop at cheaper grocery stores or costco for items I can buy in bulk. Last year, when I believed I might be going on strike, I bought a used freezer for $115, and packed it with food just in case. The strike was averted, but I learned the value of shopping elsewhere. I can buy larger packages of ground beef, chicken breasts, fish, etc; wrap them individually, and freeze them for later use.

I can buy roasts when they go on sale for $1.99 a pound and cook them anytime I want. I bought a bunch of those gladware style containers and freeze meals in them. I have hamburger helper meals, roast, ham, fish, chicken&rice, slpit pea soup, etc – all ready to go. It is so much easier to grab a container out of the freezer, and so much cheaper than buying lunch at work. That freezer paid for itself in less than 2 months, just in the money I saved by taking lunch to work. On days off, I can spend a few hours in the kitchen, making a variety of items to stock up the freezer. I can cook a lasgne in the oven to cut up, cook a roast in the crock pot, and cook something else on the stove top. Not a lot of time invested, yet I have a variety of meals for several weeks. At work, if I don’t finish a meal, I put it the freezer there. On days when I forget to grab a lunch on the way out, I can pull something out of the freezer at work.

I would also recommend the following websites. My parents have been getting the newsletters for years. Many of the tips and calculators are available free, so you don’t have to subscribe unless you want the newsletter.

There are some great tips, and also a nice article on the 3 types of debt – safe dabt (collateral that you can turn over to get out of the debt if you have to), stupid debt (credit cards, stuff you can’t get out of), and survival debt (paying rent or food costs with credit cards).

I was hoping to find on Dave Ramsey’s website some kind of budget guide that would work for us, our kids are grown and it is just the 2 of us. All of the Christian ones that I have found are outdated and many conflict. Some have car payments under transportation and others have all debt in one area. The one budget form Dave has available for free, does not list monthly medical expenses like medicines and doctor visit co-pays.

Does anyone know of any?

I have looked around the internet for the “perfect” budget forms and software.

I found nothing.

That doesn’t mean that there are good ones out there, even great ones. I like Dave Ramsey’s the best.

My suggestion, is to use the one that you like best but “update” based on your own particular situation. JUst add in those categories that need to be added in…like in your case medicines and medical expenses.

Everybodys gonna bit a different when it comes to finances. No two people have the same budget. There are similarities, but nothing will match your situation exactly. Try to cope.

Or you can model a good one for yourself on your own computer (if you have the knowledge to do it.) Then it will be perfect.

I’m not familiar with some of this terminology as I’ve never been in debt like this before…

What does “charged off” mean and how do I find out about it? and when you say ‘creditors’, does that mean Chase (since they sold the debt–they don’t have any control, or do they?) or does it mean the collection agencies?

And when you say offer them 25¢ on the $1…do you mean to base that percentage on the original $4350 debt with Chase at the time I stopped making payments or to base it on what the collection agency now says I owe ($8k something)?

I am deeply sorry that I have spoke above you. I truly regretful of that. I have been consulting and dealing with creditors for so long I forget that some people haven’t.

Creditor – That is the person or persons that has given credit. I use creditor to include collection agencies as well. Others may disagree, but that is what I do.

Charge-off – that is what happens to your account after you have gone beyond 180 days late on your account. By law the creditor has to “charge-off” the account and consider it a liability instead of an asset.

Chase, if over 180 days late, has charged off that account and “assigned” the account to a collection agency to collect. The account still belongs to Chase and not the collection agency.

The collection agency is given a certain time fram in which to collect this debt (for a commission) or Chase will take the account back and “assign” it to a different collection agency.

After a couple of years of assigning this account to collection agencies then Chase may then decide to sell the account to a third party. These are “Junk Debt Buyers”. Rarely, if ever, will you see an account sold to a JDB before 2 or more years.

Most likely, in your case, the account has only been assigned to a collection agency.

The percentage of $.25 on the $1.00 is the percentage you offer the company trying to collect the debt, whether it is a CA or the original creditor (OC). Of course, you have a better chance of getting that percentage with a CA than an OC.

I do have a question… once the debt is sold, does Chase have any say in the settlement matter at all? I wouldn’t think so….

I do know that one thing working against me in this particular case is the fact that I still have a joint biz card, a 10 year old acct in good standing, it was not in the consolidation since Jerry & I both had the cards although we each had our own acct number. Also in an attempt to reestablish my credit (I’m self emplyed and must make internet purchases), I am maintaining a new Capital One card with a $500 limit …one of the reps who spoke with my husband said that since they could see I was using that card, that they felt they should be getting the money I was paying to Capital One. I admit there is logic in that.

I suppose it is wise to not try to reestablish one’s credit until the ‘old debts’ are completely settled.

I’ve read that once the accoutn is sold to a third party junkd debt buyer, then no, Chase has no say it what or how it is collected. Even if it is with a collection agency, then it means that the account has been charged off and CHase can no longer consider that account as an assest, so it is up to the collection agency to collect it. Usually, though they are given a time limit, and if it is not met then it gets assigned to another collection agency.

If you are trying to settle for less than the full amount then you do need to settle all the accounts in the same manner whether or not those accounts are open and current. As you found out, they will not settle if you are paying another creditor monthly payments. Very few would settle like this.

So…if you are wanting to settle then you must go at it full bore.

BTW, do you own a house and have equity in the home? There maybe another way for you to get out of debt without ever having to resort to credit damaging programs.

I don’t plan to ever get in such a position again…we have cash at this time to pay the original amount, just not enough cash to pay the doubled amount (after interest and late fee charges…)

I heard that if you have enough cash to handle the original amount, and if the creditors have not charged off, then work it out with the creditors that they accept this, and have them remove the bad items from you credit report.

If they have charged off, then settle with the collection agency. This a very good month to do a settlement, especially this time of this month. So offer 25 cents on the dollar and work up from there. DO NOT go above 50 cents on the dollar.

Make sure that you get in writing a letter stating that the will settle and it is over with, then send them a money order or cashiers check by FedEx, DHL or UPS — NOT THE POST OFFICE. You need to be able to track the package all the way, plus proof that they received it.

Once you have verified that they have gotten the money, get it in writing that you no longer any other funds at all, forever and ever.

You always call the collection company and keep the call short (5 min max). Never speak to them when they call you. This keeps you in control.

As I understand it – if there are judgments on our credit then they had had to serve us papers right? We have two and NEVER have received any thing and did not know about them until we had our reports run – what’s the deal! I contacted on attorney on it and they were absolutely nasty to me. Then the other one started calling! I have not answered their calls because it’s an automated message (hate that). Should we talk to them? The one said satisfied on our report this time but the County where it was filed said they didn’t have that and that’s when they started calling. On judgments should you talk to the attorneys even though they are so mean to you and won’t even listen to you but just keep saying well if you paid it prove it – I can’t! The card number they have was not our card numbers we had!!! Any we had were paid off by CCCS and I have that.

If you have not already done so, file a dispute with all 3 credit reporting agencies. They are obligated to investigate by contacting the company filing the credit status and having them validate the status. In many cases, this is all it takes.

I have had on more than one occasion a credit card company put negative statements on a card that was paid off & closed so long ago, I no longer even have the account number. The credit company refused to talk to me unless I had the acct #, so I filed a dispute with all 3 and off they came.

If you have judgments but have not gotten a summons either in the mail or in person then you can have that judgment(s) “vacated” from your record.

You need to get an attorney.

Do not speak to anyone on the debt until you have consulted your attorney. You are under no obligation to do so. SO DO NOT TALK WITH ANYONE. The attorney can deal with them.

Go to the attorney BEFORE you do anything else…including dispute the credit bureaus as someone suggested. It is a good suggestion but should not yet be done. Attorneys can cost thousands of dollars so whether to do it pro se or with an attorney depends on your legal knowledge, how much an attorney wants and the amount of the judgment. I would not hire an attorney for a judgment of $1000 or less.

Don’t use a CCCS unless you are just such a wimp (no meaness, just the facts) that each time you talk to the creditor they make you cry or raise your blood pressure through the roof. The ONLY benefit of using a CCCS is that after 4-6 months of being on their plan the collection calls slow down. If you handle the payouts and payment arrangements yourself you have to talk to the creditor occasionally.

They don’t save you money, they don’t do you any favors, they aren’t looking out for your best interest…they simply answer the phone for you and fax some letters.

It is good that you are doing well on the CCC that you are using currently. You should feel gratified that you are one of the 20% that have success with this program.

As long as it is working for you, then you should keep doing it; but do me a favor, and make sure that you are following up on them every month just to be sure they are doing what they say they are. We don’t a re-occurrence of what happened last time.

And I agree with your statements that someone should thoroughly research all their options before deciding to go with any company.

I can’t tell you how many people that have been harmed by slick sales pitches by companies — CCCS, debt settlement, and even Bankruptcy Attorneys.

What works for you may not work for your neighbor. But I stand by my original statement that if you can afford a CCC then you don’t need it as there other programs out there that can do an even better job.

Just a little education and some real budgeting can solve most peoples financial woes…PLUS ACTUALLY SAVING MONEY FOR A RAINY DAY.

May I please suggest that you be careful about making it sound like all CCCSs are alike before you go busting chops on them? I have a close relative who is the chief of the IT department at one of them. He makes far less than IT professionals do in his area and nowhere near the amount you quoted. He is the second highest paid in that CCCS.

They are losing money because several cutthroat companies have undercut their percentage. For those who do not know, CCCS’ have agreements with the major lending companies to collect a small percentage of each payment they collect from you and send to them. This usually amounts to anywhere from 1-5%.

This particular CCCS has over 2 dozen locations covering half a particular state. The reason I will not give more details is to prevent any repercussions to my relative.

You are correct that some companies will not deal with a CCCS and even if they do, does not mean that they will work favorably. Legitimate CCCSs make their money from the lending companies, not from the consumers.

I do not recommend writing off ever using a CCCS; they may be an option. You must evaluate what they can do for you along with all options. We looked into using a CCCS once, but live in a different state than my relative. The counselor was straight up with us and told us they could not help us; we already had the lowest interest rates possible. He suggested Crown Ministries to learn more about budgeting. We never did get into one.

I did not intend for this to be a novel, but not all used car salesmen are crooks and not all CCCS centers are either. I also do not wish to start some kind of dispute.

While you are correct that you can’t paint all of the employee’s of all credit counseling services with one brush; I think we as a group of people concerned with helping other people get out of debt can paint all companies with one broad brush.

CCS are not in business for your welfare, they are in business to make money. That’s why they exist.

I guarantee that no business will lose money for the sake of their customers, at least not for long. That’s how you go *out* of business.

Your relative is surely a great guy but it’s not like he works for the Shriner’s Hospital.

I do agree that you bring up some good points, not all CCCS are bad. And I do think they serve a purpose.

I would recommend a CCCS under these conditions ONLY:

That you have a debt of $15,000 or less

That you only need a short term relief like 6 mos, never more than a year.

You are single and rent your home (including the above two points).

Can easily afford minimum payments plus a little bit more.

I have recommended CCCs to people where they need it. But the fact is that if you own your own home and can afford a CCC then you don’t need one.

You can get a better and far cheaper service without the CCCS.

The CCCS do not have the purpose of getting one out of debt, there purpose is to collect the money for the banks before one gets to overwhelmed and has to file for bankruptcy. That was there intent when they were created by the banks, and that is still their intent.

So if you fall under all or one of the categories then do a CCCS, but if you don’t then they will be no good for you.